Ottawa’s ambitious plan to transform former Nortel campus into a sprawling hub for the Defence Department appears stalled because of cost concerns and the military’s reorganization.

A plan to transform the sprawling Nortel office campus, seen here in 2004, into a new Pentagon-style hub for the Defence Department, appears stalled because of the swelling renovation bill and internal shakeup in Canada's military.

But today, Ottawa’s ambitious project to transform the sprawling office campus of failed tech giant Nortel Networks into a new hub for the defence department appears stalled because of a costly renovation bill, the military’s own internal shakeup and gripes from those in uniform about its location in the city’s west end.

And now, the two federal departments behind the move, Defence and Public Works, have gone to ground, refusing to comment on the plan’s status and keeping secret the retrofit costs.

However, one defence source has told the Star that the proposed renovation could cost more than $800 million to refit buildings deemed to be in “above average” condition less than three years ago.

That has some critics calling on the Conservative government to scale back the retrofits or even abandon the move altogether.

“The public needs to know the answers,” said NDP MP Jack Harris, the party’s defence critic.

“I think we need to rethink the whole decision. We have to see it spelled out why this is absolutely necessary and how much it is really going to cost,” he said in an interview.

“We think the budget is way out of line ... The government and (defence department) would be advised to sharpen their pencils a bit and come up with a reasonable number,” Thomas said

“Everything about this Nortel project, the way it’s been set up so far, is a boondoggle in the making,” he told the Star.

The government pitched the whole plan as a cost-saving measure in December 2010 when it bought the Nortel site on Carling Ave. for $208 million, getting 12 buildings with a total of 207,000 square metres of space.

It was planned that, over a period of five to seven year, the Defence Department would consolidate up to half of its 17,000 employees now scattered across 48 different work sites in the national capital region.

At the time, Defence Minister Peter MacKay touted the move, saying it would provide the military with a “new, modern home” in Ottawa. Consolidating defence work sites would cut costs, boost security and enable the department to work “more effectively and efficiently,” he said in a news release.

Several months later, a Treasury Board official told a Senate committee that the Nortel purchase, refit of facilities, installation of security and information technology would total $998 million.

This, even though an assessment by an engineering firm determined the buildings and the various systems, such as elevators, had been “very well-maintained” and were in “above-average condition,” according a government news release.

Today, no one is talking about the purchase, the proposed move or the price tag.

The Defence Department flatly rejected any comment, referring all questions to public works. There, a spokesperson suggested plans are still up in the air, more than two years after the purchase.

“We are reviewing our plans for the renovation of the campus in the context of an environment of fiscal restraint to ensure that all costs related to the occupancy provide best value for taxpayers. This work will not be finalized for some months,” Lucie Brosseau, a spokesperson for Public Works, said in an email.

Thomas said the concept of consolidating Defence Department offices is a good one.

“You look at the Pentagon. It makes all sorts of sense to have headquarters on one campus. That’s a dream scenario,” Thomas said.

But with plans to move just half of the department’s staff to the new facility, he questioned why the military would continue using other buildings in the Ottawa region.

“If that facility can’t hold headquarters, is the facility really too small or is headquarters too big,” Thomas said.

That’s a question that not even the military may be able to answer as it embarks on an internal reorganization. And it’s one reason the proposed move may be delayed.

The department is under orders from Prime Minister Stephen Harper to cut administration costs and get more resources to front-line units.

Retired Lt.-Gen. Andrew Leslie presented the military with a proposal for a sweeping overhaul of the department with an eye to trim the thousands of military and civilian defence staff who work in the Ottawa region.

While that blueprint appears to have been largely shelved, department brass have embarked on their own “renewal” process. But it could be another year before those recommendations are ready and with it any ideas on how much office space will be needed to accommodate headquarters staff.

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